Making Tax Digital
You have heard a lot about Making Tax Digital . HMRC is entering the digital age big time, but most importantly they’re starting with VAT. So if you haven’t yet prepared for the changes, now is the time to get your head around your obligations, and how these have changed.
Most small businesses need to sign up for MTD for VAT.
So where do I start?
Set up an online VAT account. As soon as possible.
MTD rules apply from your first VAT period starting on or after 1 April 2019. You can register online with HMRC to submit your VAT returns through your Government Gateway account. If you’re not eligible to sign up yet for MTD, a message will appear at this stage.
Once you’re signed up to MTD, you’ll find it helps you stay organised as you need to record all your VAT transactions digitally throughout the year.
MTD Compliant Software
Now that you’re storing all your VAT records in a digital format, make sure your accounting software is MTD compliant. This is also known as “functional compatible software”, and just means it can connect directly with HMRC, for when you submit your return.
Just so you know, if you get a VAT inspection, which is actually quite likely, all the information is there in one place, so you don’t need to do any extra work. “Being digital” will also help you steer clear of penalties for late submissions and non-payments – these can be quite substantial, and increasingly so for serial defaults or inaccuracies.
Submitting your Vat return digitally
If you’re using our service, you’ll save so much time as we do most of the work for you. It tells you what your VAT liability is for the accounting period, and all you have to do is click a button to submit your return via a digital link. It’s that simple.